How to Invest in Farm Land for passive income

Often overlooked by real estate investors, farm land can generating passive, active income, and capital appreciation of decades.


  • Up-Front Investment: Purchasing the farm land.
  • On-Going Investment: Annual property taxes and potentially farming expenses.
  • Return on investment: Depends on the avenue you choose.
  • Best for: Rural areas. 

How Farm Land Investing Works

Are you looking to make some money in an often overlooked industry? While farming is certainly a complex business to get into, as a real estate investor, there are a couple different ways you can get things going. 

Family standing in front of family farm

First, purchasing farmable land and then leasing it to a farmer would be the easiest way forward. Your only expense will be the property taxes while the farmer handles all the machinery, equipment, and actual farming. 

You can setup your contract with a flat fee, similar to other types of leases, or you can ask for a percentage of their farming profit if you anticipate them to do good business. 

Secondly, you could purchase an older farm for fixing up and selling/renting to a farmer. This will take more work on your end as you have to get the land ready for use again, but it can be worth while if you anticipate a lot of interest in the land.

In most cases, real estate investors will find that buying farmable land and selling farming rights to another party will be the best way forward. This is a good way to get in some passive income with property you own. 

Crowdfunding Farmland Investments

Farmland investments are much lower risk than purchasing and managing individual plots of land. Now you can invest in portions of individual farms. Best of all you can get up to 13% returns on your investment.

Click the link to Learn about FarmTogether Investing

The Pros of owning FarmLand

The number one benefit with buying farming land is the potential for on-going income. Farm land can generate steady income for decades.

Farmable land is also often overlooked by other real estate investors as they tend to focus on commercial or residential space. Lowered competition means the chance to purchase for at or below fair market value, giving you the potential for larger returns. 

The Cons of owning FarmLand

Farm land is very niche and it takes an experienced and interested third party for you to be able to turn farm land into a passive income stream. You have to do your research and know the market before investing in such land.

Farming is a complex industry and you need to know what type of farming could be done on the land and how much money you, as the property owner, could potentially profit from that type of farming. 


As with any real estate investment, you need to know the marketplace. If you are in a rural area, you have the potential for making good returns by giving farming rights to a third-party in search of farm land in the area. Worst case scenario, it ends up becoming a raw land investment that can be sold to a developer at a later date.

Farmland investments can deliver up to 13% returns at much lower risk than stocks. Click learn about FarmTogether Investing for more details.

Strong Absolute Returns7 – 13%
Average Cash Yields3 – 9%
Farmland Investing